Mad Money w/ Jim Cramer 5/19/25
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Hey, I'm Kramer. Welcome to Mad Money. Welcome to Kramerica. Other people, my friends. Hey, look, I'm just trying to make a little money. My job is not just to entertain, but to explain. Put it in context. So call me at 1-800-743-CBC. Tweet me at Jim Kramer. Investors are an unsure lot. Who can blame them? We're taught to be scared. We're taught to sell stuff on any freight. Sell, sell, sell.

To get out now anytime things look ugly. Oh man, I hate that stuff. You know what? Let's do something about it right now. You and me. Stories like the U.S. debt downgrade story from Friday. They are classic get out now items after the close. Really scary stories that scare people out of very fine stocks that could otherwise make them rich.

And sure enough, when Moody's downgraded the debt of the United States on Friday, the last of the three big grading agencies to do so, the market opened hideously as the Get Out Now crowd took action. They flared. A house of pain. Then the market rebounded with the Dow finishing up 137 points. It was up even more at one point. The S&P advancing 0.09%. NASDAQ inching up 0.02%. Decent day.

Now, we've seen a big decline off of debt downgrade before. The S&P 500 dropped an ominous 6.66% on August 5th of 2011 after state imports downgraded our debt from AAA to AA+. But

But it was all part of a hideous rollover that had more to do with potential default of European sovereign bonds than anything really involving our own solvency. Although there was a ruckus in the budget negotiations, kind of like what we're seeing now. Then the S&P shed 1.38% after Fitch made a similar downgrade, but that was in 2023. Still bad. No 6.66 decline. In both cases, there was a level of fear.

that was out of sync with the short-term prospects of the economy, which is what I care about. I say that because the long-term implications of refusing to balance the budget could be catastrophic unless we can figure out how to generate huge growth in this country. Of course, in the long term, we're all dead.

So nobody cares about this stuff until the bond market starts making us pay a price for it in the short term. And everyone always feels that's about to happen. But I want to go back to the fear, because the fear is what must be tamed if you want to become a good investor.

First, you have to be on the front lines to see where the fear is being generated. Now, I was on the front lines this weekend. I was signing bottles of my wife's Phosphoro Mezcal at a beautiful Total Wine & More in Norwalk, Connecticut, where I got to chat with scores of investors, maybe you, many members of the CBC Investing Club, where we have a meeting on Wednesday at noon.

Of the people who were there, principally to talk to me about stocks, one in four asked me about the darn debt downgrade. The level of fear was both fascinating and sad.

Almost uniformly, they were concerned that the rating agencies wouldn't pull something like this unless they believed there was a good chance that interest rates were about to skyrocket. And rates did initially go hard today, causing a lot of people to sell stocks at the open, not listening to me from that talk that I gave them. But then they went right back down because there was no follow-through, no ratings agency or another one downgraded. They didn't. If you sold when rates had gone up in the morning, well, you look like an impoverished scaredy cat now.

So that fear turned out to be unfounded. A second fear: What good does it do to invest if we're just going to be wiped out by our national balance sheet anyway? Now this one's a little tricky. Our government has a huge budget deficit. Nobody ever does anything serious about it, including Doge, which never really tried to tackle the big issues.

If the Department of Defense favored cheap drones over most of its munitions, and I mean the real drones, the real cheap ones that Ukrainians and Russians use, instead of expensive aircraft that require five redundancies to ensure our pilots don't get killed, we could save a fortune if we adjusted Social Security for just a few months. You know, a little few months. If we tax hedge funds, private equity funds, people like everyone else, or if we tax interest and dividends like ordinary income, we might actually have a fighting chance to plug the hole.

But raising taxes and cutting spending are unpopular, so the problem never gets fixed. On the plus side, it could be decades before any of it blows up in our face. Everyone who's sold socks in my lifetime because of national debt worries has been proven to be dead wrong.

So the idea that you should sell everything because of the debt downgrade is that early warning sign? That makes no sense whatsoever. If anything, it's got to be the opposite. You're being given an early warning to invest more, not more aggressively, but more of what you can save. That's the real hedge if you're worried about the government's creditworthiness, not the get out now.

I've always favored gold as insurance against excessive government borrowing, and that has worked well as of late. And when Bitcoin became legitimate, I added that to the roster of what you'll need if nothing good happens with the debt. We have a president that seems to care more about Bitcoin in the stock market, so he's a beacon for buying the stuff. But the concept of pulling out of the market because of something that might become a problem in the distant future is totally counterintuitive and wrong.

Finally, there's a spur to sell that most upsets me. Almost immediately on Friday night when I went to X, formerly Twitter, I read post after post after post about how ugly the stock market would be on Monday morning. Drenched in red ink. I read that multiple times. One after another described what would amount to be a second Black Monday. To a person, these people were graphic about the pain that was ahead. House of pain.

Now, I don't know whether they were certain and stupid that it would happen, or whether maybe they were short and trying to spread pessimism. I bet it was that. Oh, my God, but it was really effective. But it was the kind of verbiage that would try men's souls to stay long.

Now, I did my best to counter a bunch of these. I kept tweeting or X-ing or whatever. I mentioned the 2011 downgrade was very different because it came at a time when several European countries were fighting off defaults. Sure, we had a rancorous budget negotiation going on in Washington. We did get some compromise that was somewhat positive, meaning it was temporary. As for the 2023 decline, it barely mattered. But the fear-mongering was so intense...

that I gave up trying to counter it. And as the weekend went on, you could bet that Sunday Night Futures would be drenched with red when they open, and then they just get more red, and that's exactly what happened in the NASDAQ particularly. And by the way, in Envidia's Jensen Wong keynote, which I really loved, although the boy was at 11.15, it was hard to keep my eyes open for that, went back to sleep, then woke up again. Whatever, it was terrific, but it didn't change anything. I

I think the fear feeds on itself. No matter how hard I try to explain there, there'd be little follow through from the downgrade. People just kept posting the equivalent of get out now to the point where the mainstream media got a hold of it. I'm sure the bears out there were praying we do a special to get more people to sell so they could cover their short positions. In reality, if interest rates had indeed skyrocketed, then the get out now crowd might have had their day. But rates did the opposite. They pulled back from their highs. That's what happened.

You'd think that's all she wrote. We were supposed to get crushed. Instead, we rebounded nicely. End of story. It was just one more big buying opportunity. In reality, that's not the case. There'll be many other dead-out nails being issued ahead of you. You just need to remember two things. One, the people who write these are either fools who know nothing or incredibly shrewd short sellers who need to scare you as part of their business model.

The shorts need to spread fear because while we've got a lot of problems, our economy is actually doing fine. Spread fear. Yeah, that's some business. Inflation isn't yet high.

Unemployment's still low. Even if they come, we can deal with these problems. And the so-called stagflation they produce, oh, the bears love that word, stagflation, don't they? Without dumping everything right now, it's hard because it's so persuasive. But you'll have to stick with me, and we'll sit through this.

Let me get to the bottom line. The crucial thing that we in the media can do, and I say this as someone who talks to more individual investors than almost anyone in the universe and certainly more than anyone in the media, is simply cool it with the fear-mongering and cut-off guests who advocate it. A little history and some constructive thought would go a lot further if your goal is not to inflame, but to inform. I want to speak to Trey in Texas, who I know what he looks like. Trey! Trey!

Jim, I'm proud to say I just bagged my first million in the fast food space of all places. Believe it or not, you can trade this journey back to a single french fry. One I slipped on coming out of a men's room at a popular chain I'm not at liberty to name. Well... A torn ACL and a windfall later, I'm looking for a safer growth option, which brings me to Kevin Hoffman, who's been cooking up one of the greatest comebacks in casual dining history, Jim. Is Chili's parent Brinker International a baby back by?

Yes, and I'll tell you what's most annoying to me. Once it started going down, the analysts said, well, you know what? I guess that's all they wrote there. Now we're all bored by how well he's doing. I am never bored by how well a business person is doing. And neither is Trey. And that french fry, I got to tell you, if he had said that that was a Baconator, I would know where it was. Gary in Alabama, Gary.

Hey, Jim. Thanks for taking the call. Of course. I've been following you for a long time, even before the Kudlow days back when you were on the street. That was Palazzo Acura. That was Palazzo Acura, wasn't it? Long time ago, yes. Yes, it was? All right. So anyway, I've recently taken a position in Berkshire, and it can't seem to get any traction since Mr. Buffett announced his retirement.

What are your thoughts on that? Should I add to it? I think that he's got a big bench. Look, who would not have a bigger bench than someone who is his age? He's got the biggest bench in the world. You know what he has? He has the Jenkins hot seat bench. I like that. All right, anyway, look, the most important thing we can do for you right now is to cool it with the fear mongering, okay? I'm here to inform, not to inflame.

I'm here, buddy, tonight. Are there any winners to be found amid the IPO market comeback? I'll tell you what I'm watching. Then the market's been gaining momentum. But are there signs of stalling growth ahead? I'm going off the charts to find out. And later, I'm checking in with ITT to hear if this business, let's say industrial portfolio name, could stick with you for a long time. And I got to tell you, it's the kind of stock that nobody talks about and that they're bad. So stay with Kramer.

Don't miss a second of Mad Money. Follow at Jim Kramer on X. Have a question? Tweet Kramer. Hashtag Mad Mentions. Send Jim an email to madmoneyatcnbc.com or give us a call at 1-800-743-CNBC. Miss something? Head to madmoney.cnbc.com.

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With leading networking and connectivity, advanced cybersecurity and expert partnership, Comcast Business helps turn today's enterprises into engines of modern business. Powering the engine of modern business. Powering possibilities. Restrictions apply. After an anemic few months for IPOs, companies are finally coming public again.

For about five weeks after Liberation Day, the only deal of any meaningful size was Cha Ji. That's a Chinese tea house chain that came public on April 17th.

But now that most of the reciprocal tariffs announced by President Trump have been rolled back or paused and earnings season's going well, the IPO window's wide open again. In fact, while the S&P 500's had a very nice recovery from its lows, the Renaissance IPO ETF that includes the largest, most liquid, newly listed stocks has run up nearly 40%.

from its lows on April 7th. Some of the few companies that came public earlier this year have also caught fire. CoreWeave, which looked like a disaster when it barely managed to launch its IPO in late March, has now more than doubled from its deal price, and that's what tends to happen at the start of a new IPO cycle. People are skittish. They're reticent. They hold back. Let the good ones go by.

Then they try to play catch up once they realize they missed out on the IPOs being priced to move and have investors win. And that's what Corby was, priced to move, investors win. With the overall market recovery, the decline of volatility, and generally the strong performance of the few stocks that have managed to come public before the IPO freeze, we're starting to see the deals start flowing again.

First thing in May, a pair of insurance companies came public. There was a nearly $400 million offering from Aspen Insurance. That's a reinsurance company backed by the private equity firm Apollo, as well as $110 million offering from American Integrity Insurance, which is primarily focused on selling home insurance policies in Florida. Then last week, we saw the largest deal since the SmartShop self-storage offering six weeks ago. And that's when eToro came.

An Israeli financial technology company best known for a brokerage platform that's popular with retail traders came public in a deal that raised over $600 million in gross proceeds. It can do worse than that. These first major IPOs to test the market, again, have generally been well-received. Aspen Insurance up over 8% on its first day of trading. Stocks now almost 14% of overall above its offering price.

Each world popped nearly 30% on its first day of trading last week. It's very exciting. It's coming in a bit now, but remains up more than 20% from its offer price. I like it. American Integrity Insurance hasn't done as well. It's only up about 3% from where it came public. But it's still in positive territory.

Two more decent-sized IPOs should happen later this week. There's the digital health startup Hinge Health. It's looking to raise over $400 million. And the ag tech company Mountain, and that's spelled M-N-T-N, and wants to raise roughly $175 million. And the latest step for the IPO market recovery, we're starting to see IPO filings pick up.

Yeah, look, the big news last week was the Chime, an online banking disruptor. Remember the 2024 CNBC disruptor 50, and it was a number 22. That filed for an IPO in the NASDAQ. We always hope that all those, if all those companies file, boom. Now, this Chime should be one of the largest deals of the year so far. It has the potential to be the first $1 billion offering since Corrie, and that one's expected in early June.

Now, this is all very encouraging people. It's a sign of an increasingly healthy stock market. However, the IPO market is still fragile, so you can't take this recovery for granted.

Now, here's something you might want to follow. Every week, Bill Smith, he's the founder and CEO of Renaissance Capital, puts out this terrific summary of action in the IPO market. In his latest missive, he said that he's looking for three things to confirm that IPO market really is ready to roar again. One, the volatility of the stock market needs to remain relatively low. Two, more sizable deals need to perform well. And we need to get more IPO filings, especially from large companies. So far, we're seeing all this happen. So let's

Hope it holds up because it's very bullish.

But if the IPO market can keep recovering, what are some other ways to play it? I'll do my best to monitor the deal flow and look into some of the individual names that are coming public to see if any of them are worth recommending, like we did with CoreWeek, which we thought would be terrific. I think Chime's certainly worth a closer look next month. And I might take a look at some of this week's IPO names. Again, that's Hinge Health and Mountain. They're both intriguing, although I need to do more homework before I say anything definitive.

Unfortunately, I'm not as jazzed about the insurance companies that came public this month. But if you take a step back for a second and consider the theme in the aggregate, it's a very easy time to play an uptick in IPOs. Just buy the investment bank.

It's the best under the sun. And that's Goldman Sachs. Now, of the big banks, they're the most levered investment banking, and that includes IPOs and underwriters. We've owned Goldman Sachs for the Chapel Trust since late last year, primarily because I thought we'd see an uptick in deal activity this year as the Trump administration replaced the Biden administration. Now, that got temporarily derailed by the president's tariffs.

But now that those have both been paused or rolled back, and if they don't rear their ugly head again, I think the IPO revival is back on schedule. And yes, indeed, I did work at Goldman Sachs in the 80s. Now, Goldman stocks started this year strong, climbing to a new all-time high in the 670s in mid-February, right around the time when the market, the border market started all over. But as it became clear that the new Trump administration was going to prioritize tariffs,

over its more pro-business policies. That's a real negative for both IPOs and M&A. This thing pulled back quite only nearly 35% from peak to trough by the time it bottomed at $440 on April 7th.

Since then, though, Goldman's been rallying hard, in part because the IPO market bounced back, but also because there's been a pickup in emerging acquisitions. Now, if the antitrust regulators don't reflexively try to block every deal, that's the other piece of the puzzle. As with the IPOs, M&A activity has slowed down significantly when everyone was worried that the tariffs would crush the economy. But over the past few weeks, we've seen more and more large M&A tractions get announced.

Like the $10 billion acquisition of Skechers by Private Equity, from which really shocked me that those guys wanted to do that. Or the nearly $35 billion acquisition of Cox Communications by Charter Communications, major tie-up for the industry. We also just saw Capital One Financial close on its acquisition of Discover. Just today, the FCC approved FCC's $20 billion acquisition of Frontier Communications. Oh, by the way, don't forget the fact that Dixon is trying to buy Foot Locker. All this is very good news for the investment bankers at Goldman Sachs.

Of course, the stock got hit today after JPMorgan executives lowered expectations for their investment banking business at an investor day event. But I believe you can buy, really, I'm not worried about that. I think you can buy Goldman into weakness. So here's the bottom line. Now that the IPO market's making a comeback, I think it can continue, barring any additional insanity on the tariff front. Same goes for M&A. So if I'm right, then Goldman Sachs will be the biggest winner from all this wheeling and dealing, and you are getting a very big discount.

versus where I am going to tell investing club members Wednesday at noon where it is going. Mad Money's back after the break. Coming up, are stocks set to continue their move higher? Kramer is breaking down what remains to be seen in the charts to signal a leg up. Next. Are you looking to invest in municipal bonds? For extra protection, buy bonds insured by Assured Guarantee. It guarantees that 100% of your principal and interest will be paid when due.

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Now, we've had a tremendous run since the lows in early April as the White House has rolled back its most aggressive tariff plans. But what's it going to take for the market to keep climbing?

While earnings season has been pretty encouraging, this Moody's debt downgrade was discouraging to many, as I said at the top of the show. And it might make you worried that stocks are once again hostage to the bond market. Basically, things have been going great for stocks for over a month now. We want that momentum to continue. Remember, we are for you. But we also need to keep our eyes on anything that could throw the market off track. We've learned anything this year. It's very easy for stocks to get derailed, right?

And that's why we got to figure out a little deeper. So we're going to go off the charts with the help of Jessica Inskip. She's that first woman on the active trader desk at Fidelity, now director of investor research at Stockbrokers.com, as well as the co-host and founder of the Market Make Her podcast to get a sense of what we need to see before this bull can keep running.

She's been really, really red hot of late. So let's start with the weekly chart of the S&P 500. Skits says that right now the S&P is showing the beginnings of a bullish trading cycle, but it hasn't yet been confirmed. To get the confirmation, she needs to see the 13-week moving average. Okay, that's this line, okay?

cross above the longer-term 26-week and 40-week moving average. Remember, industry-placed use these 13 weeks, 26 weeks, and 40 weeks because that's one, two, and three quarters. And the quarter is the single most important unit of time in business. We're not there yet.

Thanks to the recent rebound, these quarterly moving averages are now acting as floors of support for the S&P 500. But she won't feel confident until the 13-week goes above the 26 and the 40. The last time we saw that set up was in December 2023. It was a tremendous time to buy. But, you know, think about what she's asking. That's a big ask, OK? Now, InSkip likes that the S&P is now making higher lows and higher highs. That's a classic sign of a healthy market. But she says we essentially need to overcome every lower high on the way here. And the next target is 6,000. That's less than 60 points from here.

OK, and above that, we have what InSkip calls the ceiling of uncertainty around the all time highs at 6.47. So I don't know if we can possibly break that out.

Hard to make a new all-time high, isn't it, when Wall Street can't figure out what the future looks like? Inskip thinks it'll be difficult to clear that hurdle without more clarity, especially from the government, whether we're talking about this tax cut bill or the final form of President Trump's Arab policy or the Federal Reserve. On the plus side, though, Inskip points out that the moving average convergence divergence line on MACD, an important momentum indicator, this is the most bullish thing on this chart, has made a bullish crossover. And that, I think, is going to matter.

where the black line crosses above the red one, that is crucial. And it's one of the most reliably positive signs out here. So this is all questionable and this is game on. Next up, how about the weekly chart of the S&P 500 equal weight?

That's an alternate version of the index where every stock has the same weighting. The normal S&P 500 is weighted by market capitalization, which means the index is heavily biased toward those mega caps we talk about, like the formerly banked deficit 7. The equal weight filters that out and brings the focus on the other 493 stocks in the group that aren't as heavily regulated and are

in the news. And it says the S&P equal weight is moving in the right direction with the quarterly moving averages flattening out and acting as floors of support. OK, so we can see these doing OK. But before she can truly feel confident here, she needs to see the S&P equal weight breakout above its ceiling of resistance running from 7333

OK, that's what she's got to break out of. Those are the lower highs this thing made in the way down in February and March. Like the normal S&P, though, this thing's got a bullish crossover in the MACD line. Again, this just so-so, this really bullish. So these are mixed indicators. How about the XLK? That's the Technology Selects Spider, SPDR fund. InScape thinks this S&P tech index looks to be in the early days of a bullish trading cycle.

But again, there's more resistance levels to clear before we can get another major leg to this rally. When we talked to InScape last month, she called out the $205 level as the key ceiling of resistance. The XLK cleared that level and roared higher. Now the next ceiling runs from 230 to 237. So we could see, you know, we've got to get above this. All right.

That's based on last year's highs, and we're right in the middle of that range currently. Like the S&P 500, the S&P equal weight, once again, the XOK has a bullish crossover MACD. So that's more reason to be optimistic. Tough go to be over this, okay? Not so tough to see a breakout here. However, at the end of the day, InSkip thinks that the whole market is being capped by a ceiling of uncertainty here. And what can give us clarity?

The bond market, specifically the yield on the benchmark 10-year U.S. Treasury. So take a look at the daily chart. The 10-year can launch us to new highs or kick us down to terrible lows, depending on which direction it heads in. If you like higher stock prices, then you want Treasury yields lower. All right. Keep that in mind. Lower stock prices go higher. Text bond prices go higher. Always good because it lowers the yield in this case.

Unfortunately, we didn't get that today thanks to the Moody's debt downgrade. Unskip says that if the yield on the 10-year keeps rising, well, that's a major risk to the rally in the stock market. But it really wasn't that bad today. When you look at the chart, the yield on the 10-year sure looks like it's headed higher. The next ceiling resistance is at 4.56, up about 10 basis points. If the 10-year blows through that level, the next ceiling resistance is 4.67, followed by 4.8.

And if the yoke on the 10-year closes above 4.8, well, let's just say that is the danger zone. I completely agree with this. That's very far away, though. When the 10-year shot up to those levels in January, that's when the stock market ran out of juice.

Could happen again, but we don't want it to happen. Ultimately, just when the market stopped being totally hostage to President Trump's trade policy, we need to worry about Treasury yields again. That wasn't a problem when Wall Street assumed we were headed for a tariff-induced recession. But now that a recession is likely off the table, higher interest rates are back on the table. Definitely something to watch out for. What people don't recognize is that it's better to have the latter than it is to have the former. But that's just me as a stock person.

Here's the bottom line. The charges interpreted by Jessica and Skip suggest that we've got some bullish momentum, but for the moment, it's limited by a ceiling of uncertainty. Until we get more clarity, both the broader S&P 500 and tech more specifically, probably only have so much upside. At the very least, we might need to digest our recent gains, especially if the bond market keeps going in the wrong direction. Let's take some calls. Let's go to how about we go to Miriam in New York. Miriam.

Hi, Mr. Kramer. Hi. Okay. How are you? I'm good.

I'm a little nervous talking to you. Anyway, I've had this stock for over 20 years. It's McDonald's. Should I sell it or should I keep buying? No, no. If anything, I would keep buying it. Every time it dips, I've been telling people to buy McDonald's for years now. We had some people who went when the stock dipped down to 305, said, oh, it's over for McDonald's. They

They do not understand the strength of McDonald's. And it's just an incredible machine, how well it is run. I think management's terrific. It's a great stock. Hold on and buy on any weakness. Matthew in New Jersey. Matthew.

Booyah, Jim, coming to you from New Jersey. And it goes without saying, let's go birds. Go birds. Thank you. Go birds. Of course. Thank you. And thank you for everything you do for retail, especially, especially when you called the kettle black back in 07, 08, giving us all a heads up. We really appreciate that here. Got to call it right. Thank you, Matthew. Can't be, I got a question on Carvana. Um,

You know, I know it's hitting the 300 level here. I like it. Now, you always get it. Look, there's always some guy who wants to take it down. Now, those of you who remember, we went long Ernie Garcia. He's the CEO in these single digits. I said I had enough. This model is great. I had bought a car with it. It was an amazingly smooth transaction. I

I became a believer and I have not backed away for one minute. And Ernie knows that and I'm very proud of it and we've been supporting it. And here it is at 305. Every time it's gone down, like McDonald's, we say bye. I mean, it's just a terrific situation. Hey, why don't we go to Brandon in Illinois? Brandon.

Booyah, Mr. Kramer, long-time listener, first-time caller. With Coinbase being added to the S&P today, how do we digest Thursday's news of both the DOJ investigation as well as a hacking situation? And real quick, 11.28, Lincoln Financial Field, primetime football. Bear down, Jimmy boy.

Don't worry, I'm already there. By the way, I committed to going to the Commanders game on that Saturday game in Washington. Now, here's what I feel about Coinbase. Another stock that I like, and I'm going to give you a twofer. I think that you should also like Robinhood. I like that more than Coinbase because it wasn't that crazy, obviously, about the hacks.

But Coinbase is doing very well, but Robinhood is doing exceptionally well. And I would be a buyer of Robinhood. The charts interpreted by Jessica Inskip suggest that any momentum is going to be held up by the ceiling of uncertainty. Until we get more clarity, the market will only have so much upside. I'm a little more bullish than she is, though. Now, much more bad money, including my exclusive with tech solutions company ITT. Hey, they make pumps. You can make pumps.

So stay with Kramer.

Ever since the market bottomed on April 7th, the sickle smokestack stocks, as I call them, have come roaring back. Take ITT. It's a century-old and now industrial company that makes highly engineered components for all sorts of end markets, transportation, energy, aerospace, defense. The stock has rebounded from 105 a little over a month ago to 153 today. Now, it doesn't hurt that ITT reported a solid top and bottom line.

Thank you, Jim. And we're very honored to be here. Thank you. I've got to tell you, since you've been here, you've made a lot of money for people in the capital markets. You've made a lot of money for people in the capital markets.

Let's say the deck is very thorough. You've made some terrific acquisitions, which I think have helped things. I want to start with the acquisitions because you're a very shrewd acquirer of things that don't necessarily look like they will be exciting.

Thank you. Thank you, Jim. We've worked very hard in developing this funnel of opportunities. And we looked at growing markets with a healthy margin, good companies that are leadership position in the market they operate with good management team. So Zvanehoy is a pump manufacturer, cryogenic pump manufacturer in the marine industry for LPG, LNG, ammonia.

Kesaria interconnect solution in the defense market. So good markets, good companies.

Good management. Well, that LNG, the plastic, actually the Chinese just put a tariff on it, but they need our LNG. There's a shortage there. We have it. Anything that you can do in those industries is very vibrant. That's indeed. And this is LNG for today. But tomorrow, Jim, in the next 10, 15 years, it's going to be ammonia, the way to transport hydrogen. And we are the only company today that have

pumps that are pumping ammonia as a fuel in the marine. And I know that our country has a huge amount of ammonia and the rest of the world does not have enough. So who are you working with in the United States to be able to sell ammonia pumps? We're working with all

the marine industry if it is you know the builders if are the operators each and every one of them is that the builders because of the Reliability that we have in terms of delivering our pumps on time But also the operators who are more interested to ensure that our pumps function and function all the time now I do want to talk about there's a lot of innovation people don't think there is

People just think that, well, pumps are pumps, which is completely untrue. So maybe we can talk about Vidar, which is a very good motor that can explain to people what value added you have. Sure. So innovation is how we differentiate in the market. So this is how we win and outperform the competition. So Vidar is addressing a problem that we have in the flow industry, which is wasted energy. You know, when you have a pump,

The pump is the heart of the industry. You're pumping fluids for your carton boxes outside your door, et cetera. But when there is a pump, the motor always runs 100% the same speed. Even if you need half of the flow, et cetera, what you do, the motor keeps on going 100%. It's almost like you drive your car, foot full on the accelerator.

And then you brake just to regulate your speed. Wasted. Now, the industry came out with a solution which is variable speed drives. So with a variable speed drive, you regulate the speed of the motor. But the variable speed drive are big electric boxes. They are big. They require space. Electrical. They require clean room. If you are in a

in a plant, you have dirty environment, you don't have space. So this is why variable speed driver use only 15% of the cases. This is where VIDAR comes in. So VIDAR is we put the variable speed drive within the motor. Now you have motor and variable speed drive all together, easy, drop in and drop out. It pays for itself in less than two years. In less than two years. Two years. That's fantastic.

Now, you guys do, I do want to, I mean, I think that that shows you, even with a tariff, it would be good. But you do region, well, I like how you call it, region for region. Yeah. Which is like for like, but region for, explain what region for region is so that people understand, no, this is not a situation where you really have to worry about tariffs. Yeah, we are in the market for the market, which means that we are producing and making in North America for the North American market, in Europe for Europe.

in Asia for Asia. So this means that we are not as exposed as other companies to the tariffs because they went to Asia for low labor costs. Actually, we are in Asia, but for the Asian market. We're working for Western company, with Western company, with Asian companies.

for that market and we are not exporting from there to the USA, or vice versa. So this reduced our exposure. There are a lot of people who feel that Americans do not know how to make what you're making. We feel, this is at the crux of

of what was in a presidential election. That these jobs all went overseas, that we couldn't do it, that they wiped us out, blah, blah, blah. Not true! That's not true. We make pumps in Seneca Falls, upstate New York. We make engineering valves in Lancaster, in Pennsylvania. We're making connectors in Irvine, California. So we—and those connectors are the connectors that you put in the most sophisticated defense programs.

connectors that keep the soldiers in Ukraine safe, right? So we are making those stuff in the US. - Okay, so if I go to Seneca Falls, I go there and I think, well, why didn't that plant go to Monterey? Why didn't you take it to Monterey?

Well, because a lot of engineering resources, a lot of competence in engineering are actually there in Seneca Falls. In America? In America. So if you're developing that pump, in many cases the engineering is better if it's close to your manufacturing for the improvement that you want to make, right? So that closeness and that working together is what helps to make us more competitive.

Look, I just think you've done a remarkable job. I go down the block and I see the old ITT. And by the way, people, there's so much hallucination. Don't use any of those services. They'll talk about how this telecommunication business is doing well. That is precisely wrong. What we like about you is you're a manufacturer of really important critical components that no other company can make. I want to thank Luca Savi, the president and CEO of ITT.

Guys, this is how money's made. You read about companies like this, you find out how they're doing, and you see their incredible orders, and then you watch their stock go up. Maybe with you. Mad Money's back after the break. It is time. It's time for the lightning round. Let's start with Jake in New York. Jake.

Booyah Jimmy Chil, how you doing? I am doing well, how about you? I'm okay man, but I'm wondering about this company, if they're okay. It might be a little bit of a melty ice cube. What do you think about Zoom? I think Zoom's last quarter was actually pretty good. They do have some good apps. My stepson worked there in fairness and folded his clothes and I really liked them very much and I think they're doing a lot right, but it's taking them a very long time. Let's go to Bob in Connecticut. Bob!

IBRX is not a great stock, community bio. I've looked at it for a very, very long time. I don't like the fact that they are. They've been losing money forever. I am not in their camp. Let's go to Yin in Washington. Yin. Hey, Jim. Booyah. Booyah to you. What's up?

Hey, this stock has been up about 150% over the last three weeks, but has dropped 60% today. Ava Technologies. Yeah, they got an Airbus contract that's really good. And I got to tell you, I think that what's happened there is people got it. You had to be in it beforehand. Now you're too late. I have to move on and find the next one. Let's go to Patrick in California. Patrick.

Jimbo, big booyah to you, big guy. Oh, thank you, partner. Thank you for taking my call. I'm making thousands of people move. You are the Mac Daddy, dog. Mac Daddy.

Okay. Thank you. Thank you. You come from SoundHound AI. SoundHound. I got to look at Professor Ben Stoder, the scientist. He and I often coagulate about SoundHound. There's a new way to use a bad verb, and it's not true. Here's the deal. I think SoundHound is really, it's not a thing of imagination. They could end up making money, but enough. Enough with the SoundHound. Hey, look, I tolerate poundage.

How much can you ask from one person? Let's go to Kevin in New Jersey. Kevin. How you doing, Jim? Happy 20th. Oh, thank you, buddy. Thank you. Appreciate it. Don't you wish you were that young again? Nah, I like where I am. I'm a fine wine. I'm a chemist. I'm a chemist. So I got, I got, my father had a, it was originally called a Genna valve put in. It was a hard, hard valve based on, um,

He couldn't have the conventional valve put in. So I did a little research. I never knew who was in control of his valve, only to find out Edwards Life Science. Yeah, they're now in a good zone. They were in a bad zone for a long time. I saw someone recommend it. I was watching Frank's show this morning, and I was listening to Jensen one year, trying to, like, my third time trying to get it together there. And someone was recommending Edwards Science. I looked, I was like, smart fella. Yeah.

How about we go to Anita in Virginia. Anita. Hi. How are you, Jim? How are you doing, Anita? I'm a member. Oh, fantastic. Don't forget, Wednesday meeting. Thank you. Yes. Yes. And I've just signed up again for the club membership. Oh, thank you very much. Thank you. So my question is about Sterling Infrastructure.

Yeah, I was late to this one. This is a very, very good company. I was focused too much on AECOM and Floor and Caterpillar. You have a good one there. These are good. We often talk about them and we really like them because that money is finally coming through. And that, ladies and gentlemen, is the conclusion of the Lightning Round. The Lightning Round is sponsored by Charles Schwab.

Was Walmart really supposed to eat all the tariffs that have been put on the goods it carries? It sure sounds like it. Take a look at President's posting this weekend. Quote, Walmart should stop trying to blame tariffs as the reason for raising prices throughout the chain. Walmart made billions of dollars this year, far more than expected. Between Walmart and China, they should, as I said, eat the tariffs and not charge valued customers anything. I'll be watching, and so will your customers. Quote. First, let me say that that's a nice thought. Very Bernie Sanders-like.

It would be terrific if Walmart just operated as a charity, directly subsidized its customers. Fact is, though, all retailers are wrestling with these tariffs, and almost none of them can afford to eat the cost because they have incredibly low profit margins to begin with. Forget that none of them knew the tariffs were coming, so they couldn't plan ahead. When they did find out, they did their best to ship their sourcing to countries that looked like they'd be the lowest, hit with the lowest tariffs. Why? Because they didn't want their customers to get hurt.

They might have been able to actually deliver better prices for the customers of the White House and give them more time to get ready. But they didn't know about Liberation Day. Nobody did. So they didn't get a chance to find lower prices for a lot of their goods. I'm sure they're working on finding new sourcing right now. But as the president surely knows, you can't change your entire supply chain overnight.

Now, Walmart immediately told suppliers that they were going to have to make things much cheaper because they didn't want to hurt their American customers. It's not like Walmart's vertically integrated, but it sure is a heck of a lot of heft when it bargains with the suppliers because there's huge scale, and scale means power. My understanding is that they negotiated the best deal possible on each item. The company then had to decide how much they could make on these goods when they sold them to their customer.

Further, my understanding is that they tried to make it so other items that weren't tariffed only saw their prices raise a little bit. They blended things to prevent a big increase in price for some specific heavily tariffed products. Good thinking. Now, there may be some cases where Walmart plays offense to game market share by eating the cost entirely and then keeping prices lower than the competition. But they don't yet know how much they'll have to lose on each of the items.

They'll definitely lose money on some, though, which is why management didn't put out a forecast. Now, Walmart had the bad fortune of reporting first, and that's why they were the most visible. We're about to hear from a whole slew of retailers, most of which have nowhere near the heft Walmart has with its suppliers or the low margins that Walmart has in goods it sells to consumers.

I'm willing to wager that given Walmart has price leadership on pretty much every item it sells, the president would most likely end up posting that the other companies should cut their prices to as low as Walmart's. None of them, with the exception of Costco, has the scale to go to bat for the consumer like these guys do. He would post, quote, why can't you guys be more like Walmart, that great Bentonville Colossus? I'm watching you.

At the end of the day, Walmart's doing its best. It's always tried to hold the line on prices. Those of us who actually shop in stores like Walmart know that only Walmart and Costco have really low prices. Check them out. To go after them for raising price post-tariff is to go after the best inflation fighters in the world. These guys have low single-digit margins. For heaven's sake, if they try to eat the cost of a 10% tariff, they could, over the years, become cash flow constrained. Oh, and if the president had given them time, prices would be lower still.

But they didn't get that time. When the smoke clears, Walmart will have the lowest prices, tariffs or not. This is the last company on earth that should be singled out for profiteering. If even Walmart's guilty, then nobody is innocent. Like I said, there's always a bull market somewhere, and I promise I'll find it just for you right here on Mad Money. I'm Duke Bamer. See you tomorrow.

All opinions expressed by Jim Cramer on this podcast are solely Cramer's opinions and do not reflect the opinions of CNBC, NBCUniversal, or their parent company or affiliates, and may have been previously disseminated by Cramer on television, radio, internet, or another medium.

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